Correlation Between Sibanye Stillwater and Revival Gold
Can any of the company-specific risk be diversified away by investing in both Sibanye Stillwater and Revival Gold at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sibanye Stillwater and Revival Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sibanye Stillwater Limited and Revival Gold, you can compare the effects of market volatilities on Sibanye Stillwater and Revival Gold and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sibanye Stillwater with a short position of Revival Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sibanye Stillwater and Revival Gold.
Diversification Opportunities for Sibanye Stillwater and Revival Gold
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sibanye and Revival is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Sibanye Stillwater Limited and Revival Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Revival Gold and Sibanye Stillwater is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sibanye Stillwater Limited are associated (or correlated) with Revival Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Revival Gold has no effect on the direction of Sibanye Stillwater i.e., Sibanye Stillwater and Revival Gold go up and down completely randomly.
Pair Corralation between Sibanye Stillwater and Revival Gold
Assuming the 90 days horizon Sibanye Stillwater is expected to generate 3.59 times less return on investment than Revival Gold. But when comparing it to its historical volatility, Sibanye Stillwater Limited is 1.52 times less risky than Revival Gold. It trades about 0.0 of its potential returns per unit of risk. Revival Gold is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 21.00 in Revival Gold on September 15, 2024 and sell it today you would lose (1.00) from holding Revival Gold or give up 4.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sibanye Stillwater Limited vs. Revival Gold
Performance |
| Timeline |
| Sibanye Stillwater |
| Revival Gold |
Sibanye Stillwater and Revival Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sibanye Stillwater and Revival Gold
The main advantage of trading using opposite Sibanye Stillwater and Revival Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sibanye Stillwater position performs unexpectedly, Revival Gold can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Revival Gold will offset losses from the drop in Revival Gold's long position.| Sibanye Stillwater vs. Revival Gold | Sibanye Stillwater vs. Galiano Gold | Sibanye Stillwater vs. US Gold Corp | Sibanye Stillwater vs. HUMANA INC |
| Revival Gold vs. Westward Gold | Revival Gold vs. Heliostar Metals | Revival Gold vs. Cabral Gold | Revival Gold vs. Cassiar Gold Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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